Best open source accounting software for small business
Searching for new accounting software is like looking at a sandwich shop’s menu because there are so many types of bookkeeping solutions – including small business, billing and invoicing, SME and more – that you’re left scratching your head. Have you ever considered an open-source accounting software — a program for you and your IT team to examine and adjust its coding to fit your business requirements?
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Thankfully, SelectHub has your back with our top picks of the best open-source accounting software. Before examining this list, why not read further to learn more about open-source software, its standard features and benefits.
What is Open-Source Software?
Open-source software is a type of program for you and your IT team to examine and adjust its coding to fit your business requirements. This type of solution differs from free software.
Open-Source vs. Free Software
It’s easy to confuse free with open-source software, but in actuality, they’re as similar as burgers and hot dogs. As the name implies, free software often comes with no price tag, but still allows users the full benefits of the software. Often free software is everything it appears to be on the surface: a free solution for your business to implement. Similarly, open-source software provides users with access to software, often without any associated costs. The primary difference between free and open-source software is that an open-source solution provides access to the source code, hence the name. This access allows users to make modifications to the system at all levels.
While free and open-source solutions are incredibly similar, the nuances that set them apart can make a big difference for business. When considering these types of solutions make sure you’re aware of how much access you’ll have to the source code and ask about hidden fees to ensure there’s no confusion about what type of software you’re implementing.
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While other types of software can come with benefits like robust technical support from the vendor, they also come with disadvantages like steep price tags. Similarly, open-source solutions come with perks and pitfalls. Benefits include:
- Versatility: Tailor this program’s source code to align with your organization’s needs – i.e. capabilities, updates, priorities and more.
- Costs: Pay minimal to zero licensing and subscription fees for this type of program.
- Security: Pinpoint bugs, potential threats, security gaps and more immediately within the source code and fix or remove them.
No two software are alike. Nevertheless, most accounting solutions come with a few standard functionalities. However, keep in mind that just because a feature is popular or common, it doesn’t mean it’s necessarily right for your company. A few standard features you’ll want to watch for include:
- Bank Reconciliation: Ensure all of your transactions are correct with this accessory.
- Tax Management: Manage tax documents and regulations with this tool.
- User Management: Determine whether you want single users or multi-users and even assign user roles with the right user management attribute.
- Reporting: Formulate and print various types of reports such as profit and loss, cash memos, bills, invoices and more.
Still not sure what features to prioritize? Take a peek at our detailed features article or our sophisticated requirements template to make a thorough wishlist.
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Best Open-Source Accounting Software
It’s time to review our picks for this software. Have your wishlist ready; here’s our complete roster.
From agriculture and construction to real estate and telecommunication, Odoo accounting caters to businesses of all sizes, regardless of industry. It offers both on-premise and cloud deployment and is available as an app for Android and iOS devices.
Odoo possesses various differentiators that set it apart from the competition.
- Free Forever: This platform is free for infinite users so long as you don’t need additional applications or hosting options. The community/open-source version only has invoicing and payment capabilities.
- Artificial Intelligence (AI): Scan and upload PDFs or images to vendor bills and automate their creation with AI.
- Customer Portal: Obtain order statuses, invoice and payment tracking through the client portal. Patrons may revise their plans, order upgrades, downgrade or unsubscribe in one centralized location.
- QR Codes: Scan QR codes with the user’s native banking program to complete transactions. The QR code is also available on PDF invoices and appears on payment screens for quotes and bills.
- Bank Statements Import: Leverage OFX, QIF, CSV or Coda formats to import bank statements when a bank isn’t supported through Odoo.
- Balance Sheet Calculation: Add current year earnings to balance sheets automatically. Profit and loss is promptly calculated according to selected dates. Administrators can lock entry dates for all users.
- Multiple Currencies: Work with various currencies and automatically change currency rates at different intervals.
- Revenue Dashboard: Access various metrics such as MRR, recurring revenues, churn, CAC, CAC ratio, growth, forecasts, ARR, CLT and CLTV.
- Tax Audit Report: Evaluate tax report calculation for audit purposes. Pick a line and click the audit button to audit journal items.
- Reconciliation Report: Gain reconciliation reports to account for differences between bank statement balances and accounts.
- Country-Specific Statements: Work with country-specific statements, including Intrastat reports, VAT statements, profit and loss/BS of the country, VAT subjected customer listings and more.
This apparatus offers automatic reconciliation propositions, additional journal item registrations, record searching and the inputting of manual reconciliations for open and paid invoices. You may also immediately work with partial and full reconciliation propositions from invoices or bank statements. The automated reconciliation function allows bank statements to sync from more than 15,000 banks in the U.S., Canada and New Zealand in real time.
The tax engine offers a wide range of tax calculations such as price included or excluded, percentage, grip, partial exemptions and more. This module delivers tax reports in accrual or cash-based formats according to a particular region. You may also implement tax rules that automatically cipher values on invoices.
Establish default configurations for accountants and adviser roles, allot infinite users with various access rights as the administrator and automate business flows with inter-company regulations. Govern company subsidiaries within the same system with the user management feature. You can even arrange documents into several journals by department or type of activity and split roles throughout multiple users.
Handle numerous pre-made templates ranging from cash flow statements to profit and loss. Link multiple companies’ bookkeeping data into groups. You may also take notes on reports and include more modifiable rows.
Although Odoo Accounting has all of the common open-source accounting software features, it offers supplementary tools for your accounting practices. These additional accessories include:
- Account Receivable: Build invoices with payment conditions, numerous taxes, discounts, price lists and more as well as print out invoices or send them via email.
- Credit Management: Promptly propose emails, follow-up letters and responsibilities for users to administer credit collection procedures.
- Bills Payment: Trace deposit tickets and print checks in large quantities.
- Accounting Analytics: Allocate a single accounting entry into several analytic accounts with analytics tags and pliable distributions.
Like most solutions, this program has some limitations. These drawbacks include:
- It doesn’t offer payroll modules.
- It lacks third-party debt recoveries.
- It doesn’t account for unpaid fees or penalties.